Arbeitspapier
The EU Self-Surplus Puzzle: An Indication of VAT Fraud?
The world runs a trade surplus with itself: the reported values of exports exceed the reported values of imports. This is a logically impossible but well-known empirical fact. Less well-known is the fact that, in recent years, more than 80 percent of the global surplus is a trade surplus that the EU has with itself. In this paper, we show that this EU self-surplus amounts to a striking 307 billion Euro in 2018. It persists in goods, services, and secondary income accounts. It also exists within the Euro Area, and is strongest between neighboring countries. Around the 2004 Eastern Enlargement, the EU self-surplus quadrupled. Balance of payments data from the United Kingdom appear highly distorted. We argue that these phenomena are not only due to measurement error. Rather, a large fraction of the EU's self-surplus puzzle seems related to fraud in value added tax. The resulting loss in tax income could amount to as much as 64 billion Euro per year.
- Language
-
Englisch
- Bibliographic citation
-
Series: CESifo Working Paper ; No. 7982
- Classification
-
Wirtschaft
Financial Aspects of Economic Integration
Current Account Adjustment; Short-term Capital Movements
Remittances
Tax Evasion and Avoidance
- Subject
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missing trade
VAT fraud
statistical discrepancies
current accounts
- Event
-
Geistige Schöpfung
- (who)
-
Braml, Martin T.
Felbermary, Gabriel J.
- Event
-
Veröffentlichung
- (who)
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Center for Economic Studies and ifo Institute (CESifo)
- (where)
-
Munich
- (when)
-
2019
- Handle
- Last update
-
10.03.2025, 11:46 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Braml, Martin T.
- Felbermary, Gabriel J.
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2019
Other Objects (12)
The EU self-surplus puzzle : An indication of VAT fraud?
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The EU self-surplus puzzle : An indication of VAT fraud?
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The Ifo Institute’s Model for Reducing VAT Fraud: Payment First, Refund Later
Emerging fraud : fraud cases from emerging economies
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Surplus-Management
Countering VAT fraud in B2C trade with 3rd territories and 3rd countries : a tax technology solution
The fog of fraud: Mitigating fraud by strategic ambiguity
The fog of fraud: Mitigating fraud by strategic ambiguity
The EU self-surplus puzzle : An indication of VAT fraud?
The EU self-surplus puzzle: an indication of VAT fraud?
The EU self-surplus puzzle: An indication of VAT fraud?
Surplus
Surplus
The Ifo Institute’s Model for Reducing VAT Fraud: Payment First, Refund Later
Emerging fraud : fraud cases from emerging economies
Food fraud
Surplus-Management
Countering VAT fraud in B2C trade with 3rd territories and 3rd countries : a tax technology solution
The fog of fraud: Mitigating fraud by strategic ambiguity